Fiona Martin analyses native title benefits

Fiona Martin, a senior lecturer at the School of Taxation and Business Law, at the Australian School of Business, appeared before the House of Representatives Standing Committee on Economics last month as an expert witness on taxation of native title benefits.

The inquiry into the Tax Laws Amendment (2012 Measures No. 6) Bill 2012 clarifies the issue of whether payments made by mining companies to Native Title Groups and other Traditional Land owners in Australia are considered income, which consequently makes them subject to income tax.

"Once a mining company decides to undertake some form of mining activity on land that does or may belong to Native Title Groups they often also decide to make some form of payment to this Group. These payments are usually part of what is called an Indigenous Land Use Agreement (ILUA) that can be entered into in accordance with the Native Title Act 1993 (Cth)," she explains.

With a background in taxation law, Martin's current PhD research analyses this very issue. In her paper she indicates that in most cases, payments made are not income and that the law lacks clarity. She presented her research before the House of Representatives in Canberra, arguing in support of the provisions for the Bill.

"[The Bill] should aid all parties in negotiating efficiently and about the terms of the agreement that are really important to them, such as protecting heritage and sacred sites and without the added concern and burden of the lack of clarity of the income tax situation," she explains.

The payments, made in accordance with ILUAs, cover a range of matters including compensation for long term damage, access to the land and providing mining companies with a social licence to operate.

The House of Representatives Standing Committee has since recommended that the Bill proceed, which will see it be presented before the Senate.